Debate Transcripts

LB 194 (1999)

General File

February 16, 1999

SPEAKER KRISTENSEN: LB 846 advances. LB 194.

CLERK: (LB) 194, Mr. President, introduced by the Revenue Committee and signed by its members. (Read title.) Bill was introduced on January 8, referred to the Revenue Committee for public hearing. The bill was advanced to General File. I do have committee amendments pending, Mr. President.

SPEAKER KRISTENSEN: Chair of the Revenue Committee, Senator Wickersham, is recognized to open on the bill.

SENATOR WICKERSHAM: Thank you, Mr. Speaker. This bill is in the nature of a clean-up bill brought to the Revenue Committee by the Property Tax Administrator's Office. Now I can't tell you that all of the provisions are absolutely technical. Some

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of them have substantive effect and I think I'll try to discuss some of those rather than discussing all of the individual provisions of the bill. One of them, and I'd almost forgotten about it until I heard the Clerk reading the title and when he said "provisions relating to mortgages" then it rang a bell in my mind. So maybe I'll talk to you about that provision first so I don't forget it later on. There are provisions in Nebraska law that require the taxation of the value of a mortgage to the financial institution or other person that holds it; that requires the taxation of the value of a mortgage to the financial institution that holds it. So, in other words, if you have property that's valued at $100,000, it has a $50,000 mortgage, the assessor would be required to send a bill for the tax on $50,000 to the bank and the bill for tax on $50,000 to the property owner. Sound like a good deal? Well, it doesn't work that way because there's provisions that says you can waive payment of the tax by the financial institution and, guess what, every single financial instrument in the state of Nebraska that secures a loan with real property has a waiver of that provision. Hasn't been used in many, many, many, many years, but it stays on the book and...books and is a curiosity for people like me, who are interested in such things. Property Tax Administrator's Office became interested in it and now wants to strike it. Now, that makes a substantive change in Nebraska law, but it does affect a provision that hasn't been used for a long, long time. There are provisions that are more substantive. One of them is a new definition and that is the definition of assessment roll. And what you will ... what you see in the bill in principle is that the definition of assessment roll is broad enough to include all property in the county, whether it is taxable or not taxable, and then I'm going to suggest to you that there be an amendment to that provision a little bit later on in the committee amendments. But the main issue is a new definition and that definition is assessment roll and, as it is in the bill, it is very, very, very broad. Now, if something is contained within something call ... defined as an assessment roll, does that mean it's going to be taxed? Does that mean it's going to be valued? Not necessarily, because there will be exempt property in the assessment roll. It will be described in the assessment roll so you know what it is, but it won't be valued and it won't be taxed. So the assessment roll is not a roll of taxable property. That isn't what it's

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intended to be. It is designed to be a listing of all property in the county. Now right now you could create something that looked like the assessment roll that's defined in the statute if you went to various places and combined various lists of property, so it is something that you could do now, but it just doesn't combine it all into one place. There are changes in penalty statutes. One of them makes clear that the penalties are distributed in the same fashion as the tax. There has ... there is a proposal to change the penalties for failure or late filing of a personal property tax return. That has become a bit of a difficult issue. Two years ago, at the request of county assessors, the Revenue Committee recommended to you, and you adopted, a fairly significant penalty for failure to file. We're modifying that penalty structure so that you have a different kind of penalty if the taxpayer suddenly remembers and files late, or there is a stiffer penalty if the county assessor has to go out and find them and come in and pay. And, if you recall, we've done similar structures in other areas so that it is encouraging, in fact, the taxpayers to self-report rather than being discovered by the Property Tax Administrator and giving them a break if they self ... or the county assessor, giving them a break if they do self-report. There is a provision that moves the date at which the county assessor sets values from March 1st to April 20th. That is to give the equalization process a little bit more time to work. There are some provisions in the bill that concern motor vehicle taxes. One of them is a bit redundant because it's also in section... in LB 141, but the effort there is to correct a number of pieces that have to do with the valuation of motor vehicles and the exemption process for motor vehicles and to make clear how those processes are going to work. One set of provisions in the bill that has some significance, although it is largely a recodification of the existing law, are the provisions that concern the Property Tax Administrator's Office relationship to county assessors, and the processes that the Property Tax Administrator's Office can use to discipline or guide the county assessors. I wouldn't say that there are significant changes in that area, but there is a recodification of those provisions into a unified structure so that you can follow it through. There is one area that relates to those issues and that is in the bill a request by the Property Tax Administrator's Office to exempt manuals and directives from the requirement of a public

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hearing under the Administrative Procedures Act before enactment. Those manuals and directives could be something that where the county assessors were later held accountable for under the disciplinary process and you'll see that there's a proposed committee amendment to that particular provision. There is a section in the bill that addresses an issue that arose out of Grand Island. I'm sorry that Senator Peterson isn't here if she wanted to comment on it. But what it does is allow TERC to adjust classes of property that haven't already been adjusted by a county when you have a TERC protest. And what happened in Grand Island was that the county board adjusted a couple of classes. There wasn't necessarily any disagreement with that, but then there was a TERC appeal and the request was to adjust all classes of property, and if they would have adjusted all classes of property, they would have adjusted the classes that had already been adjusted and that would have produced an unfair result, so the upshot of it was that there was no adjustment made. The bill would change that result and allow the TERC to adjust the classes that had not been adjusted. There are some provisions in the bill that deal with clerical errors, a new definition of clerical errors to expand that to computer issues and a number of other items. I think that's appropriate, a little bit on the technical side, not as substantive, but clerical errors, as you know, can be corrected under some circumstances and it's important to have an appropriate definition of those things. There is a provision in the bill that you may think is a little bit odd. It is a provision that says that the Property Tax Administrator's Office doesn't have to have an assessor's certificate, even if they're acting as a county assessor in a county. But, obviously, the Property Tax Administrators, if they're going to be guiding all of the assessors in the state, that's a little bit of a redundancy. I think that is perhaps enough of an overview of the bill...

SPEAKER KRISTENSEN: One minute.

SENATOR WICKERSHAM: ... itself. Mr. Speaker, I'd be happy to respond to questions about the bill itself. There is a committee amendment.

SPEAKER KRISTENSEN: Senator Wickersham, you're recognized to open on the committee amendments. (Standing Committee amendment

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AM0198 is found on page 476 of the Legislative Journal.)

SENATOR WICKERSHAM: Mr. Speaker, the committee amendments deal with a couple of individual areas. One of them is potentially controversial. I noted in the opening on the bill that we have a new definition that's proposed for the law of an assessment roll and I indicated that that was a very broad definition to include all property in the county. The committee thought it was advisable to modify that definition by striking all references to exempt personal property and the reason for that striking of that language is so that you don't require the county assessor to list all of the dogs, all of the jewelry, all of the of the household furnishings, all of the raised breeding livestock, all those things that are exempt and we always had trouble counting and taxing in the first place. It doesn't seem reasonable to cause the assessor to try to list all of those items. I also indicated that the bill, in the main, had a provision which would have exempted manuals and directives issued by the Property Tax Administrator's Office from the Administrative Procedures Act. The committee amendment would strike manuals, making manuals Issued by the Property Tax Administrator's office subject to the APA. Directives would still be exempt. The ... there's a new section added to allow the Tax Equalization and Review Commission to hear appeals in assessor discipline cases. There is a provision that provides that if you assess a late filing penalty, a late filing penalty for exemption or for exempt status, that the penalty is assessed against the property and not the organization and that ... and it makes clear that the penalty is then distributed to all of the taxing authorities that would have shared in the tax. Now, the controversial or the potentially controversial provision in the committee amendments is a new section allowing county treasurers an option with regard to notice for delinquent taxes. Under the current law, what happens is that the county assessor publishes a delinquent tax list in the newspaper or some other legal publication. The committee amendment, after January 1st of 2000, provides an alternative and the county assessor is the one that would have to make the choice, but the county assess ... county treasurer, I'm sorry, could choose, in lieu of publication in a legal publication, could choose to mail notice to the last known address of the owner of the property that has tax delinquent. Now, the committee amendment does not require

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that notice be mailed. It allows the county treasurer to decide whether notice will be mailed or notice will be published and to do one or the other. And I see Senator Byars has already put on his light, so I'm sure that he wants to discuss that particular provision of the committee amendments. So 1, Mr. Speaker, I will close on the opening of the committee amendments at that point and look forward to Senator Byars' discussion.

SPEAKER KRISTENSEN: Debate on the committee amendment? Senator Schimek.

SENATOR SCHIMEK: Yes, thank you, Mr. President. Members of the body, I think this amendment, this particular amendment about publication, came about because of a bill I introduced in Revenue Committee, which was LB 136, if I remember correctly, and I want to raise it here this morning because I don't believe this amendment cures what I thought was a problem with our tax system and I'd just like to air it a bit before the body and get your take on it. In December of 1997, 1 got my tax notice for taxes to be paid by the following April 1st and August 1st, and they were actually 1996 taxes. They always run in arrears. So I paid the first half of our taxes some time in late March to meet that April 1st deadline. I was literally shocked when I got the check back in the mail saying I couldn't pay those taxes because I hadn't paid the last half of the previous year's taxes, and this was the first that 1 real17ed or knew about it. And what actually happened to us, I've never ever been late paying taxes before, I want to clarify that for the record, but what happened is that we paid off our mortgage in that year and the mortgage company paid the first half of the taxes and somewhere along the line we didn't realize that all the taxes hadn't been paid for that year so we, naturally, didn't pay them. And when we got the notice then in 19 ... this would have been then in April of 1998, finally, that they wouldn't take our check because we hadn't paid our back taxes, we paid them, we paid it all immediately, but we had by that time $171 worth of interest accrued on those taxes because it started running in August of that year and ran clear till actually April 3, 1998, is when I got the notice back. Now, I went ahead and paid my taxes. My problem is ... can't be solved. It's already taken care of. But I'm wondering how many other people that may be happening to, and so that's why I introduced my bill and that's

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why I was hopeful that we could send out a notice twice a year, once after April 1 to tell people they were delinquent, and once after August 1 to tell people they weren't delinquent. At the hearing what happened is some of the county treasurers came in and said basically that they thought that that could be done and probably would be more effective than publishing in the paper, and I don't know if you're like me but I never read those names in the paper. Some of you may because you live in smaller communities, but I just never read those names in the paper. in one instance, we found out in Douglas County it's not the Omaha World-Herald that those names are published in anyway. I think it's the Daily Record or the Business Journal or something. It's not a publication that people normally ... that most people look at. So I think there's still a problem. I don't think this amendment solves the solution be... or solves the problem because it just refers to property that's up for sale. And, incidentally, I might tell you that this notice that I got said that this...

SPEAKER KRISTENSEN: One minute.

SENATOR SCHIMEK: ... property was assigned for sale because of unpaid taxes. I mean that's a terrific shock, and if we're going to ask people to pay their taxes and pay them on time, we ought to at least have courtesy to tell them that they are delinquent, just like your doctor or your dentist, you know, sends you a bill and says, sorry, you're overdue, where interest starts running and you have a chance to ray that right away. I don't know. Maybe it's not a huge problem. I wanted you to be aware of it. I wanted you to know how this whole discussion got started on the publication angle. Thank you.

SPEAKER KRISTENSEN: Mr. Clerk, an amendment on the desk.

CLERK: Mr. President, I do, but I might indicate the Business and Labor Committee will have an Executive Session at ten o'clock, Room 2022. Senator Byars would move to amend the committee amendments, Mr. President. (AM0304 is found on page 540 of the Legislative Journal.)

SPEAKER KRISTENSEN: Senator Byars, you're recognized to open on your amendment to the committee amendments.

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SENATOR BYARS: Thank you, Mr. Speaker. Senator Schimek, I certainly can understand your frustration and why you felt a need to ask for this ... this language to be inserted into the committee amendments, but I need to tell you what my motivation is, and there are several relevant to my amendment, and talk about what my amendment is first. Basically, what it does is, is return the language to the language that we're present using ... presently using which allows for the single notification and allows for publication of delinquent taxes. In the years that I was on the Gage County Board of Supervisors and Chairman of that board, we found that this vehicle above all, the publication of the legal descriptions of the delinquent tax parcels, was probably the number one deterrent that we had to people not paying their taxes on time. We could count the minute that we published our notices that the treasurer's office would have to add extra help because people were flocking into the office to pay their taxes. It was a tremendous deterrent and served exactly for the purpose that it was designed. it certainly... it ... we talk about embarrassment but, you know, when you have an obligation to pay taxes in your counties in the state of Nebraska, you also undertake what goes along with that, and that's the fact that if you don't pay your taxes you're going to be somewhat punished. You're going to have to pay interest and, in this situation, your names are going to be ... your title of your property is going to be published, the legal description, so that, in effect, you can't just ignore it. What we found that with one notice, two notices, people just take them and throw them in "File 13" and really don't take them seriously. So I feel that it's absolutely necessary and the reason for my amendment is to put the publication or keep the publication notification the same as it is now. Now, obviously, there are others who are interested in this. The Nebraska Press Association, for very obvious reasons, have found this...this issue has been argued many times before and for all the logical reasons the language has been maintained. But something that I don't think that we've ... we've thought about, and I had several calls over the weekend, was relative to financial institutions. Many financial institutions make mortgages on property without tying it, as part of their payment, the real estate taxes. And, as part of the agreement that they have with the people that they lend the money to, with the mortgage securing the property,

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is that they will, on a timely basis, pay those real estate taxes. Well, the financial institutions really have no way of knowing this other than perusing the records in the county treasurer's office for who it is that's paying and who isn't, unless you have a publication notice. And they use this. They take this list, take the legal descriptions, match them, now with all of the computer technology that we have that's not difficult for them, to find out who it is that isn't paying their taxes and, in effect, puts them in default on their mortgage. And so I think there's several good reasons that this language should remain the same, and I'm certainly interested in hearing the reactions of other members of the body. But my amendment strikes the language which takes out publication and adds a second notice, and I would ask you to support me on this amendment to the committee amendments.

SPEAKER KRISTENSEN: Senator Byars, your light is next. Senator Wickersham.

SENATOR WICKERSHAM: Thank you, Mr. President. I, obviously, rise in opposition to Senator Byars' amendment and I was interested in ... obviously interested in what Senator Byars had to say, but there may be some misunderstanding about what the amendment does, Senator Byars.- The amendment does not prohibit publication of notice; does not prohibit publication of notice. What it allows is the local treasurer to make a judgment about what is the most effective way to produce the result that you described, that is payment of delinquent taxes. Now, Senator Schimek was quite correct when she noted that in some counties the delinquency notice is published in a special publication and that, in order to receive that publication, you have to have ... you have to be a subscriber and, in fact, the subscription list for those kinds of publications is very limited. It isn't every property tax owner in the state or in the county that would be receiving that so they, effectively, receive no notice out of that kind of a publication. The other issue I think is, for assessment of whether or not this is a good amendment, is whether or not we don't trust our local elected officials to make the best kind of decision about what is effective in their community, recognizing that we do have a considerable variety amongst the counties of the state. Now, the result that Senator Byars described in his county is one

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that I think would also apply in Sioux County, but I see no harm in allowing a local elected official to make that decision and to find the way that is most effective and efficient in their community. They know their taxpayers. They know how they are going to be able to reach them. They know how they're going to be able to induce them to pay their delinquent taxes in a timely fashion. Senator Schimek's remarks are accurate. The amendment that is proposed by the committee does not fully address her concerns. But if her bill had been passed we would have required both publication and mailing, at least in my recollection of the bill, and we did not ... the committee did not think it was appropriate to have another mandate on the county treasurers. We preferred, as is evident in the committee amendment, to allow the local treasurers to make a choice and, quite frankly, I think that it's appropriate to allow them to have a choice, and Senator Byars' county would probably continue to publish. My county, Sioux County, would probably continue to publish, but the fact that they have a choice I don't find disturbing, or the fact that they should have a choice I don't find disturbing either.

SPEAKER KRISTENSEN: Senator Baker.

SENATOR BAKER: Mr. Speaker, members of the body, I rise in support of Senator Byars' amendment. What applies in Sioux County, Gage County, also applies in Hitchcock County. You'd be surprised how many people look at these publications in the paper and say, well, this city lot or that city lot is delinquent in taxes and the owner, they can't find him, don't know who it is, they'll go out and buy those tax certificates and clean up the property. And also they, in many cases in our area, people do know where these owners are that they can't locate and this provides a means to, some cases, locate those absentee landowners who may have inherited a piece of property, however small it might be, a lot or something, and so on. They do ... are able to find them then. Senator Byars almost said we'd ought to put the names of those people in there too in the paper. That'd really cause some tension then, if we could put the names, but I don't suggest that at this time. I'd yield any of my time to Senator Byars, if he wants it.

SPEAKER KRISTENSEN: Senator Byars, you have approximately four

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minutes if you care to use it.

SENATOR BYARS: Thank you, Mr. Speaker. I think right now that counties select, as part of their annual business, a newspaper, typically the newspaper or publication of largest circulation within the county or within the geographical area in which they're located. They try to do this on the basis of the circulation, the number of publications that will reach the largest population, the largest number of people. Are they going to reach everyone within their county? No, they certainly aren't. Will they reach enough to create the type of deterrent that they wish to accomplish with this type of publication? Yes. In all. respect to Senator Schimek, I think what she says is true in that not everybody is going to be reached, but enough people will be reached to create the incentive for people to go in and pay their taxes. Certainly, Senator Wickersham, this is ... this creates permissive language. This troubles me somewhat in the fact that it's ... this is not a new mandate. This is something the county treasurers of our state have been living with for a substantial period of time. I have never heard any of those treasurers in any way, in a negative form, come to me and say that this was something that they did not want to do. I don't see a necessity for changing the language. I don't see the necessity, quite honestly, for the expense that would need to be taken for a second notice. What is the cost now of a notice, of a notice through the mail? A dollar and a quarter, a dollar fifty per notification? I'm not sure. I think the economics of the public notification is more economical. I think it accomplishes what's set out to be accomplished. I think this is good law that we have lived with for a period of time and which at least my county treasurer feels comfortable with, and I don't see any reason for the change in the language, and I would ask that you adopt the amendment to the committee amendments.

SPEAKER KRISTENSEN: Senator Jensen.

SENATOR JENSEN: Thank you, Mr. President, members of the body. I wish to stand in support of the Byars amendment. You know, who is really benefit ... benefitted by a notice of delinquency anyway? Certainly, if you're an individual property owner you know, you know that taxes are due and they're to be paid.

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Certainly, I have certain dates on my calendar that I have redlettered: April 1, August 1. You just know that if you own a piece of property that taxes are due on those dates. So who really is benefited by a notice? The community, I think, is benefited because they know who has not paid their taxes on time and if they're not paid on time who picks up that cost. Certainly the bankers, the mortgage holders have a right to know if these taxes are not paid on time because they are a prior lien to that property. So I think it, as Senator Byars mentioned, it is permissive. I don't think we need permissive language in our statute. I think these notices should be... should be made in the ... whatever the publication that is chosen by the treasurer and that notice then goes out to the public and the public has an awareness of what is happening within its county, within its community. I would urge the body to adopt the Byars amendment. Thank you, Mr. President.

SPEAKER KRISTENSEN: Senator Stuhr, followed by Senator Hilgert, Wehrbein, Schimek, Crosby, Vrtiska, Wickersham, Jones, and Schellpeper. Senator Stuhr.

SENATOR STUHR: Thank you, Mr. Speaker and members of the Legislature. I stand in support of Senator Byars' amendment. I believe that it is the public's right to know about this information and to...and that we need to continue to protect that right. I really don't know what the motivation was to make this permissive, but I did some research in my local county and my local newspaper did a run of the costs of publishing these legal notices and it was actually eight-tenths of one percent. So, if we're talking about expense, I don't believe that that should be the reason that we allow this publication to be terminated by the individual county. So I rise in support of Senator Byars' amendment. Thank you.

SPEAKER KRISTENSEN: Senator Hilgert.

SENATOR HILGERT: Thank you. Hello? (Taps on microphone.) Thank you, Mr. Speaker. Members, I rise in support of the Byar's amendment as well, you know, and (LB) 136 was "IPP'd" a week ago. I believe the genesis of what is included in the committee amendments and what will be stricken by the Byars amendment was an idea brought before the committee at that time of the

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hearing. I don't believe this idea of going only to publication, albeit with Senator Wickersham's assurance that there's an option, what we're basically doing is going into less notice versus more notice. Having the option of just mailing alone, I don't think that ever really did have a hearing. To my knowledge, the lobbyist for Douglas County, there was no vote for ... on Douglas County Board that this was a need or a requirement or a legislative priority at all. This idea I don't believe got a hearing. The bill that it did get a hearing or that it was mentioned at, that certainly isn't enough notice for the opponents of this idea to come forward in a public hearing in the fashion of which we pass laws in this state, so it's almost indicative of the concept itself. A public or a mailing only would be less publication versus ... or less notice versus more notice. Publication plus mailing I wouldn't certainly have a problem with. There was a letter that has been circulated regarding even perhaps the constitutionality of going through less notice versus more notice. Some people believe, I believe, that there are some parties that say that this is an antiquated procedure regarding publication. But, frankly, because of the complex financing and ownership schemes of property today, I think publication is required to be maintained. If you had a conservatorship, different trustees, the modern schemes of owning and financing property I believe demand publication at a minimum. If you want to require publication and mailing, that's ... that would be fine but, again, that's not what we're talking about today. We're talking about what would, in effect, giving the authority of a county official to do away with publication and just mailing it to the last known address. Many of you who do mailings, I try to do a mailing to my district once a year, know how many households ... what the turnover is in your district. And to put all of what is riding, basically a delinquent tax notice, the power of the state which could perhaps ultimately even seize the property if unanswered, only on one single system of mailing to last known address, ignorant of the modern financing schemes and ownership schemes and all the issues of conservatorships and everything else that we have to deal with today, frankly, I believe deserves a full-blown public hearing, which it did not receive, to the best of my knowledge. So I heartily support the Byars amendment and hope that we could get on with the business today. Thank you.

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SPEAKER KRISTENSEN: Senator Schimek.

SENATOR SCHIMEK: Yes, thank you, Mr. President, members of the body. I just have a couple of questions, if I could, of Senator Wickersham.

SPEAKER KRISTENSEN: Senator Wickersham, would you respond?

SENATOR WICKERSHAM: Excuse me, yes.

SENATOR SCHIMEK: Yes, Senator Wickersham, excuse me, I have just a couple of questions. The present existing statutes call for publication...

SENATOR WICKERSHAM: Only.

SENATOR SCHIMEK: ... on January 1, right, of ... of... ? I mean that has...that isn't really changing with this, or does it?

SENATOR WICKERSHAM: It is...I think it occurs, I'm looking at the statute.

SENATOR SCHIMEK: Or, I mean...

SENATOR WICKERSHAM: It happens in March.

SENATOR SCHIMEK: Oh, March.

SENATOR WICKERSHAM: Six weeks prior to the first Monday of March.

SENATOR SCHIMEK: I misspoke, yeah. Four to six weeks prior to the first Monday of March.

SENATOR WICKERSHAM: Right.

SENATOR SCHIMEK: And that's the only time that there's any notice.

SENATOR WICKERSHAM: That's correct.

SENATOR SCHIMEK: Okay. Then...

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SENATOR WICKERSHAM: Any required notice.

SENATOR SCHIMEK: Any required notice.

SENATOR WICKERSHAM: Yes.

SENATOR SCHIMEK: Now, how far back does ... do the delinquent taxes go in that case? Are they for the previous year's taxes or the year prior to that? I'm not sure that I know how soon these things can go up for sale.

SENATOR WICKERSHAM: Well, sale is ... sale is different than the publication of notice, Senator. Each year...

SENATOR SCHIMEK: Right.

SENATOR WICKERSHAM: ...you would just sell the delinquent taxes for that year. The fact that property is included in the delinquent tax notice, in fact, frankly, I don't remember if the amount is published in the notice, but if it is I think it would include all prior delinquent taxes.

SENATOR SCHIMEK: So it could go back for several years possibly.

SENATOR WICKERSHAM: But it'd be an aggregate amount. I don't know that they list each year separately.

SENATOR SCHIMEK: Okay. Well, I'm just trying to get clear in my own mind if we started this publication next year and it was four to six weeks prior to the first Monday in March, does that then ... are we talking about the delinquencies from the previous year? Is ... that's what we're talking about.

SENATOR WICKERSHAM: Yes. For example, in 1999 you would publish the delinquencies for the prior tax year, 1997.

SENATOR SCHIMEK: Seven, right. And so, in effect, if somebody didn't, for some reason or another, pay their taxes in April of the previous year or August of the previous year, their taxes could be...have been running for almost 12 months or almost... I

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mean their interest...

SENATOR WICKERSHAM: On the ... on the...

SENATOR SCHIMEK: ... could have been running for almost 12 months.

SENATOR WICKERSHAM: On the first half.

SENATOR SCHIMEK: On the first half...

SENATOR WICKERSHAM: Yes.

SENATOR SCHIMEK: ... by that point.

SENATOR WICKERSHAM: On the first half, that's correct.

SENATOR SCHIMEK: So we're talking about quite a big of money.

SENATOR WICKERSHAM: Yes.

SENATOR SCHIMEK: Okay. Thank you. Mr. President, members of the body, I ... I'm still concerned about this and, Senator Hilgert, if publication is important, then perhaps in Douglas County we should ask that publication be done in the paper of general circulation, which would of course be the Omaha World-Herald. I suspect that people in Douglas County aren't really getting adequate notice now. I suspect that if we did a mailing to them they would have even better notice than they are getting right now because I don't believe that, as Senator Wickersham stated earlier, that that many people are subscribers to the papers that this is in. There's also a great deal of difference between property in urban areas and property in rural areas. I haven't a clue as to what...

SPEAKER KRISTENSEN: One minute.

SENATOR SCHIMEK: ...the description, the legal description of our home is. I don't have a clue. People in rural areas do know and do pay attention to those legal notices because they deal with that legal description more than we do here in the city. So I think it's good in some ways to give treasurers the

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ability to be flexible, but if we're going to require publication then I think that we ought to require it so everybody gets adequate notice, not just some people in some counties. Thank you.

SPEAKER KRISTENSEN: Senator Crosby.

SENATOR CROSBY: Thank you, Mr. Speaker and members, and, Senator Schimek, I have great sympathy and understand exactly how you felt when you got the bad news, because if there's anything that drives all of us crazy is some kind of bureaucratic mistake, shall we call it, or whatever. But, having said that, I'll hop in here and try not to say what other people have said. I do support the Byars amendment for several reasons. In the first place, it's going to cost the counties more to send out more notices, so the counties should, you know, I think you should know whether or not ahead of time whether the counties want to do that. The second thing is that I'll have to tell you, folks, when that first one comes out in October or whenever it is, I look for my description right away, I get out my tax bill and look for Sheridan, whatever it is, to be sure that I'm not on that list. And I'm not telling DiAnna that she has to do that, but that's a habit that I've had over the years to be sure that nothing has happened. I happen to pay my taxes myself and put ... put the money in my own savings account to do that because over the years, in the good old days, the original home savings and loans companies, when you made your mortgage payment, all of that payment went against the principal and interest and then, when they paid the taxes, they charged it back and, in the long run, the person who had gotten the mortgage, like I, you made a little bit of interest that way. But now they've changed that and it doesn't ... they don't do that anymore so, instead of putting it into the escrow with the company, we do it ourselves and pay ... and I pay them myself. But, to get away from that particular part of it, I do think that one of the things Senator Wickersham said, that he trusted his local elected officials to make good decisions, I do too, but I think this puts a political burden on them that they don't need. Who's going to sit down and say, I think they might get pressure from constituents to leave me out, don't put me in. I really do think that would be a political burden. And, my friends, we're going into the twenty-first century and you think

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everything's different because we have computers and everything in the courthouse? The courthouse is still probably the most political entity in this state and in the country. The courthouse is political and those people in the courthouse, who are elected by each one of us, have a lot of political pressures. You think we have them here. You go over and be county treasurer or county clerk or the assessor. Be the assessor for awhile and see the kind of pressures you get. So that's my two points. It would cost the counties more. We must be sure that the counties want to pay that. The second thing is that I don't think that we should burden our county official or our treasurer that way. So, aside from the fact that I'm... I think the daily newspaper is the quickest and easiest way to publish it, I want you to think about those people in the courthouse. And I'm ... you can tell how old I am. I still call it the courthouse. I don't call it the city-county building. It's the courthouse. Thank you.

SPEAKER KRISTENSEN: Senator Wickersham.

SENATOR WICKERSHAM: Thank you, Mr. Speaker. I've been listening to folks say that they support the Byars amendment and that's good. They get up and speak their minds. But, frankly, I'm confused about part of what I'm hearing. This is not a new mandate, is not a new mandate. It is an option for the counties to act in the way that they see is the most flexible and responsible in their counties. There must be a new wind blowing in this Chamber today, a new wind blowing. Over the last three years, we have passed bill, after bill, after bill that allowed more flexibility to local officials in a variety of areas to be efficient and effective. There's still a few of those bills around this year. A new wind is blowing, a new wind: No, local officials, we're not going to allow you to find the ways to be most efficient and effective. We know how to do it for you. It's the way we've always done it and that, by golly, is the way we're going to continue to do it. A new wind--the way we've always done it, the best way, and you can't figure out how to do it any better and if we let you choose you'll make the wrong choice. A new wind. Now, is this about less notice? 140. it might be notice to whom. That's an interesting question, notice to whom. Is it important that I have notice that Senator Peterson has delinquent taxes? I'm not going to pay them for

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her. Is it important for me to know that Senator Byars has delinquent taxes? I'm not going to pay his either. Is it important that I know that I have delinquent taxes? Probably, because I would like to pay them. How am I going to find out if I have delinquent taxes if I've forgotten them, like Senator Schimek did? I can either find out in the newspaper or I can find out in a notice that my local treasurer mails to me. This allows the local treasurer that option to do that, not on a case-by-case basis, as Senator Schimek might have implied, or Senator Crosby, I'm sorry. This is an all or nothing. Either you publish or you mail notices. It's not on a case-by-case basis. All or nothing; one or the other. Which one works in your county? All or nothing. It's interesting that Senator Crosby says there will be too much political pressure at the local courthouse to make a decision. I don't understand that argument. Those are the people that would... should and would know what is supposed to be most effective in their community. What kind of political pressures are we subject to, to make no change at all? This new wind that's blowing, this new wind that we know exactly how you should do it and you shouldn't get any option to do it any other way even if you want to, that new wind is one that I think should be reduced to just a little whisper, just a little gale that went through quickly and then we went on about our business of trusting our local elected officials to make good decisions and allowing them the flexibility to make those decisions and to serve their constituents. That's what the issue is about.

SPEAKER KRISTENSEN: One minute. Senator Kremer has the following guest visiting the Legislature this morning. They are 16 members of the Leadership Tomorrow class from Aurora and Merrick County and they're in the north balcony. Would you please stand and be recognized by your Legislature. Thank you for being with us. Senator Jones.

SENATOR JONES: Mr. President and members of the body, I want to go at this just a little bit different angle. In my county the last two years, well, when it came out in the newspaper and, in fact, I was just home this last weekend and I seen it in the newspaper all printed up, all the legal descriptions of all the delinquent taxes, but my courthouse the last two years have been busy for about the next 60 days and had to put one person on it

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because we got investors coming from Minnesota coming down and buying the back taxes for the difference in the interest. And so, in order to get that all in place so that they can buy it, in case they'll end up with it down the road some place, well, it takes a lot of work and it takes one man in the treasurer's office to do it. But I guess they complain about it, but another way to look at it, they ... we do have our taxes to keep our local governments going when that happens. And so, with that idea of it, I continue to believe that we should do it so, with that angle of it, I think I'm going to continue to support Senator Byars' amendment to see that they are...continue to be published, because my county might be one of them that might say, well, no, we're not going to print it because we'd keep the out-of-state investors out. So I guess you look at that two ways, but I'm going to still support his amendment. Thank you.

SPEAKER KRISTENSEN: Senator Schellpeper.

SENATOR SCHELLPEPER: Thank you, Mr. President and members. There still seems to be a lot of confusion about what this amendment does, the committee amendments. You're either going to pay the newspaper or you're going to go the other route. The argument this morning boils down to the Press Association came in and said, hey, they're going to take away some of our revenue. Do you want to put the revenue into the newspaper or into the county to use for some other purposes? It allows them to do it either way. My local county does it both ways. They send out notices in a plain envelope whenever they're due, and they also publish it if they're delinquent. So, to me, this shouldn't even be an argument. It allows either way to go. It has nothing to do with the tax sale, that Senator Jones says, nothing to do whatsoever. They go to the courthouse and they find that out. The newspaper doesn't mean anything. It all boils down to whether or not the newspaper's going to get paid for publishing this page or two-page list. That's what it boils down to. Simple. It's is it better business to send one to the individual taxpayer that owes that tax, or to put it in this here newspaper or in Omaha in this here Journal that nobody reads? To me, it's much better to go to the individual taxpayer that owes this money so they know that their taxes are actually due. But it just strictly boils down to whether or not you want to use the tax money to pay the newspaper or if you want to save

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some tax money and send this other ... other notice. We've had these battles before in here and the Press Association seems to think that, we're doing it this way now; by golly, we get good money for this here publication; you have to continue to pay us. And that's what it all really boils down to. If you think that the newspapers need this here revenue then you should vote for the amendment. If you think the taxpayers deserve a break then vote it down, because the taxpayers are actually paying for that there newspaper printing of the county. So it's ... this is a fight that we have every few years in here, whether we're going to cut back on some of these here publications that we now currently do, and the Revenue Committee amendments basically said you can do it either way, whichever way that your county wants you to do it. The county board can make that decision. But I think they should have that ... that they can go either way rather than say, no, by God, you're going to publish it and you're going to pay this here publisher. Very few people read that there list unless they just want to see if their neighbor has paid theirs, just more of a gossip column than it is anything. If you want to print gossip, you should read Ann Landers instead of putting this here publish of these here taxes. It really doesn't mean a lot to publish that in the newspaper because the newspaper does not pay that, that tax. It's the taxpayer that pays it. So think about what you're doing here. This doesn't do a lot of things that people have mentioned this morning. It's strictly a fight between the newspapers and the taxpayers, and I think the taxpayer should win every time. Thank you.

SPEAKER KRISTENSEN: Senator Raikes.

SENATOR RAIKES: Thank you, Mr. Speaker, members of the Legislature. I rise to oppose the Byars amendment. I, I guess following Senator Wickersham, in his remarks, I'm hearing arguments from a lot of people that I agree with, but I'm coming to exactly the opposite conclusion about how to ... what to do with this amendment. Senator Schimek made the point that if we want to be blown along by this new wind maybe we should not only require publication in a particular county but we ought to tell them which publication. I think that's exactly the wrong direction to go. I would remind you that the bill, as it is, without the amendment, would allow the county to make a choice.

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If they want to continue with what they've been doing, that choice is completely open. If they would elect to do something different then that is open to them. All it is doing is allowing a choice. It really comes down to a decision about how best to serve the constituents in a local community, and the question is whether we do that by a state mandate or whether we allow the people in that local community to make their own decision. So, again, I oppose the Byars amendment. Thank you.

SPEAKER KRISTENSEN: Senator Byars.

SENATOR BYARS: Thank you, Mr. Speaker. I think the debate has been lively. Certainly there has been an element of confusion relative to what the committee amendments want to accomplish. I don't think there's any confusion on what I want to accomplish with my amendment. I appreciate what Senator Schellpeper, the point he made and the fact that we should always be sensitive to the taxpayers of our districts, of our counties, of the state of Nebraska, and I feel that we're being exactly that. Because I don't feel it should be the burden of any taxpayer who pays his taxes promptly to carry those who don't. And when we send a first notice out, which is in the statutes right now, you have basically 14 months after that notice is sent out to pay those taxes before this publication is printed. You have about as much opportunity to remember that you forgot to pay your taxes as I can possibly imagine. I don't think this is punitive in any way. So I would say the publication, the requirement to publish, is one that protects all of us as taxpayers in our counties and our districts. I, having been a county official, I certainly concur with Senator Crosby. The county courthouse is still very much a political animal and you have pressures put on elected county officials, and I say "elected", because there's nobody more close to the ... that are more close to the electorate than county officials. And let's not forget that as they have tried to streamline their offices and they have tried to be efficient in the way they run county government at the demand of their taxpayers, when they have an option of another task to do, such as putting together the publication of delinquent tax parcel...delinquent parcels of real estate, versus the regular, every day duties that they have taking care of their constituency in their office, if this is an option, believe me, many county treasurers are going to push the notification off to

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the side because they don't have time. Are we mandating? No. Senator Wickersham is absolutely right, the committee amendments do not put any new mandates in place. We're mandating now and I still am absolutely convinced that this publication does work. And, Senator Schellpeper, if people didn't read this in their publications, there wouldn't be the lines at the courthouse after the publication is made to pay their taxes. They're embarrassed. And after 14 months, with the exception of some situations that occur that are going to occur regardless of what system we use, after 14 months they should be embarrassed and they should be at that courthouse paying those taxes, and I, again, stand in support of my amendment.

SPEAKER KRISTENSEN: Senator Robak.

SENATOR ROBAK: Question.

SPEAKER KRISTENSEN: Question's been called. Do I see five hands? I do. The question before the body is, shall debate cease? All those in favor vote aye; all those opposed vote nay. Record.

CLERK: 26 ayes, 0 nays, Mr. President, to cease debate.

SPEAKER KRISTENSEN: Debate has ceased. Senator Byars, you're recognized to close on your amendment to the committee amendments.

SENATOR BYARS: Thank you, Mr. Speaker, and thank you, colleagues. Obviously, as I said in my last... in my last statement, this I think has received interest from all the members of the body as it should, because it does affect our taxpayers, and there is some difference in opinion on whether this would affect them positively or negatively. But, as Senator Wickersham has so ably pointed out , their committee amendments would make this permissive; would not be less punitive to the taxpayers who didn't pay their taxes than what we have in place right now if the county treasurer would choose to do so. I have not seen a huge outcry uproar of constituents that, including the county treasurers or members of county boards, that have felt this is a change that's necessary, and I have not seen the hue and cry of those same county treasurers

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that they feel that this is a mandate with which they're overburdened and that they cannot live with. I think just the opposite there. They're glad to have the kind of support that this legislation does give to them to enable them to fairly collect the taxes that are due in our counties. So I do feel that the point has been made that this is a good amendment. That the statutes, as they're presently in law in the state of Nebraska, are good and fair statutes and, again, I would ask you to support this amendment.

SPEAKER KRISTENSEN: You've heard the closing. The question before the body is the adoption of the Byars amendment to the committee amendment. All those in favor vote aye; all those opposed vote nay. Have you all voted? Record.

CLERK: 27 ayes, 14 nays, Mr. President, on the adoption of the amendment.

SPEAKER KRISTENSEN: The amendment is adopted. We're back to debate on the adoption of the committee amendments as amended. Senator Coordsen. Senator Landis. Senator Wickersham, you're recognized to close on the adoption of the committee amendments. He waives closing. The question before the body is the adoption of the committee amendments to LB 194. All those in favor vote aye; all those opposed vote nay. Record.

CLERK: 38 ayes, 0 nays, Mr. President, on the adoption of committee amendments.

SPEAKER KRISTENSEN: The committee amendments are adopted. Debate on advancement of the bill. Senator Crosby.

SENATOR CROSBY: Thank you, Mr. Speaker and members. Senator Wickersham, would you answer a couple of questions for me.

SENATOR WICKERSHAM: Certainly.

SENATOR CROSBY: I was looking at the bill and at the committee statement and so on.

SENATOR WICKERSHAM: Okay.

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SENATOR CROSBY: I listened to your introduction but I wasn't quite sure if you tried to overcome some of the ... I noticed the only two people who came in for the bill was ... were George Kilpatrick introduced it and then Catherine Lang-Morrissey.

SENATOR WICKERSHAM: Yes.

SENATOR CROSBY: And no other proponents, but you had three opponents.

SENATOR WICKERSHAM: Those were...

SENATOR CROSBY: Did you try to overcome that with the language that you ... the hospitals and the independent colleges, and so on?

SENATOR WICKERSHAM: Well,...

SENATOR CROSBY: Explain why they didn't want it and then tell me if you tried to overcome it with the committee amendment.

SENATOR WICKERSHAM: Okay. There were three individuals testified about a particular provision, and that was the assessment roll provision. There was a representative of hospitals. There was a representative of religious organizations. There was a representative of private colleges. And they all testified that they didn't like the definition of assessment roll; that there hadn't been a definition of assessment roll in the statute before. Either they had questions about it or didn't think it was appropriate. I think what they believed was that somehow being on an assessment roll...

SENATOR CROSBY: R-o-1-1?

SENATOR WICKERSHAM: Yeah, that you were going to be...

SENATOR CROSBY: Yeah, r-o-l-l, okay.

SENATOR WICKERSHAM: ... that the assessment roll was only tax ... was only taxed property, but, in fact, you have lists now that are the exempt property, that are the taxed property, and

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literally all it does is combine those separate lists into one list and call that an assessment roll.

SENATOR CROSBY: And so do you think you...

SENATOR WICKERSHAM: It has no implications as far as whether the tax...

SENATOR CROSBY: ... of changing their tax status, whether or not they're exempt.

SENATOR WICKERSHAM: No, it does not change their tax status. For the most part, the individuals that were testifying, their tax status is dependent upon the application for and the granting of an exemption.

SENATOR CROSBY: Right.

SENATOR WICKERSHAM: And that's...

SENATOR CROSBY: I...so ...

SENATOR WICKERSHAM: ... that...

SENATOR CROSBY: ... that hasn't changed.

SENATOR WICKERSHAM: ... that has not changed. They would still have to apply.

SENATOR CROSBY: Okay.

SENATOR WICKERSHAM: And if the exemption is granted, they are not taxed. If the exemption isn't granted, then, of course, they are.

SENATOR CROSBY: But this doesn't change any...

SENATOR WICKERSHAM: This does not change that.

SENATOR CROSBY: ... any provisions or anything that they ... that might change their exemption?

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SENATOR WICKERSHAM: No.

SENATOR CROSBY: Okay. Thank you very much. I just thought people should hear that because there were three opponents and all we had been talking about was the idea of the bill, itself, so I thank you for answering the questions so everybody understands what... that as of now, you promise that it's okay. Thank you. Thank you, General.

SPEAKER KRISTENSEN: Further debate on advancement. Senator Wickersham, you are recognized to close on advancement of LB 194 to E & R Initial. He waives closing. The question before the body is the advancement of LB 194 to E & R Initial. All those in favor vote aye; all those opposed vote nay. Record.

CLERK: 29 ayes, 0 nays, Mr. President, on the advancement of LB 194.

SPEAKER KRISTENSEN: (LB) 194 advances. Items for the record.

CLERK: Thank you, Mr. President. Transportation Committee reports LB 368 and LB 517 as indefinitely postponed. Those reports signed by Senator Bromm. Hearing notices from Natural Resources and from Agriculture; a time change request from Urban Affairs Committee, and a new A bill. (LB) 84A by Senator Wickersham. (Read for first time by title.) That's all that I have, Mr. President. (See pages 577-578 of the Legislative Journal.)

SPEAKER KRISTENSEN: LB 784.

CLERK: (LB) 784, Mr. President, a bill by Senator Schrock. (Read title.) The bill was introduced on January 20, at that time referred to the Natural Resources Committee. The bill was advanced to General File, Mr. President.

SPEAKER KRISTENSEN: Senator Schrock, you're recognized to open on your bill.

SENATOR SCHROCK: Members of the Legislature, LB 784 is a bill that gets us in compliance with state ... with the federal... federal statutes. Section 1 would be a corrective

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